Making the Most out of your Small Business Monthly Sales Reporting

Tracking performance on a trailing 12-month cycle will highlight trends and take the seasonality out of your reporting.

It can be extremely difficult to get a sense of how your company is doing when tracking performance indicators such as sales, gross margins, expenses, profits, average sale, customer count, etc. by any other method than on a trailing 12-month cycle.

If you track sales for the past month or year–to-date, it will tell you just that, what comparable sales were for the past month, or the year-to-date. It says nothing about where your company trend heading, whether sales overall are heading up or down. What about if your biggest season is Christmas, but for some reason this year sales come a little earlier than in previous years.Well the answer to all those, is by tracking sales (and other indicators) on a trailing 12-month cycle. So if you want to track sales for Christmas and you are looking at it on December 2^nd, your sales comparison should be for December 1 of last year to November 30^th of this year, compared to the same months from the year prior. This takes the seasonality out of your business. If the trailing 12-month sales are trending up, that’s good. If they’re trailing down, that’s bad.

If you do this each month, then you can start to graph it and see it very clearly (see above). In this case, posting the trailing 12-month’s sales at the end of each month will allow you and your team to visually see the trends and whether or not the results are trending up or down.

Added tip: If you start tracking this trending year-over-year, you can overlay two or three years data on the same graph, to see how you’re performing each season, quarter, or during specific times of importance for you during the year.

Easy to understand by everyone – up is good, down is bad. Also this takes all seasonal fluctuations out of the numbers.

Visit Kraig Kramer’s website for more information on Trailing 12-Month reporting.

Andy

P.S – If you are looking for something to help you with your reporting, consider the following:

• Your payment processor is likely to have an online portal, which tracks all your sales and is able to generate reports
• Considering upgrading to a more sophisticated Point of Sale system, which would provide you with inventory tracking, reporting, payment processing integration, and much more
• If you are a more tech oriented person, consider implementing a FREE business intelligence solution such as LogiReport or Jaspersoft, both provide advanced reporting functionality.